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Study: Wealth gap widened for blacks, Latinos

WASHINGTON - The enormous wealth gap between white families and blacks and Hispanics grew larger after the most recent recession, a private analysis of government data finds.

White households had a median net worth of greater than $88,000 in 2002, 11 times more than Hispanics and more than 14 times that of blacks, the Pew Hispanic Center said in a study being released Monday.

Blacks were slowest to emerge from the economic downturn that started in 2000 and ended early in 2001, the report found.

Net worth accounts for the values of items such as a home and car, checking and savings accounts, and stocks, minus debts such as mortgage, car loans and credit card bills.

Greater wealth means a greater ability to weather a job loss, emergency home repairs, illness and other unexpected costs, as well as being able to save for retirement or a child’s college tuition.

According to the group’s analysis of Census Bureau data, nearly one-third of black families and 26 percent of Hispanic families were in debt or had no net assets, compared with 11 percent of white families.

“Wealth is a measure of cumulative advantage or disadvantage,” said Roderick Harrison, a researcher at the Joint Center for Political and Economic Studies, a Washington think tank that focuses on black issues. “The fact that black and Hispanic wealth is a fraction of white wealth also reflects a history of discrimination.”

Black net worth declines
After accounting for inflation, net worth for white households increased 17 percent between 1996 and 2002 and rose for Hispanic homes by 14 percent to about $7,900. It decreased for blacks by 16 percent, to roughly $6,000.

Regardless of race and ethnicity, the median net worth for all U.S. households was $59,700 in 2002, a 12 percent gain from 1996.

Only white homes recouped all their losses between 2001 and 2002. Both Hispanics and blacks lost nearly 27 percent of net worth between 1999 and 2001; the next year Latinos had gained almost all back (26 percent) though blacks were up only about 5 percent.

Roberto Suro, director of the Pew Hispanic Center, said the accumulation of wealth allows low-income families to rise into the middle class and “have some kind of assets beyond next week’s paychecks.”

“Having more assets enabled whites to ride out the jobless recovery better,” he said.

Harrison says Hispanics were more insulated from the downturn than blacks, so they took less of a hit. For example, Hispanics made employment gains in lower-paid, lower-skilled areas such as the service and construction sectors.

Blacks still subject to ‘last hired, first fired’
Blacks were hit hard by job losses in the manufacturing industry and in professional fields, where they were victims of “last hired, first fired” policies, he said.

Only relatively recently were large numbers of blacks and Hispanics able to make investments and accumulate wealth. They were slower to enter the stock market during the 1990s rush and then had less of a cushion when the market began its decline in 2000.

Another factor affecting disparities is that whites are far more likely to own their homes; homeownership is among the most common ways to build wealth.

Census figures released in August showed the national median household income remained basically flat between 2002 and 2003 at $43,318. Median incomes for whites ($47,800) and blacks ($29,600) also were stagnant, while the median income for Hispanics fell about 2 percent to $33,000.

Re: Study: Wealth gap widened for blacks, Latinos

yup.. lets just introduce some discriminatory legislation to "solve" this problem

do you have any other solutions? this isnt something party policy will change. its many deeply rooted issues, you cant just step in and snap your fingers

btw knowing your history around here my friend, ill add some more. its easy to throw all whites into one "grouping", but what about the tons of immigrants to north american throughout the 1800's/1900's who faced quite a bit of discrimination? maybe most were "white" but it didnt stop discrimination among clashing cultures. over time, things calmed down. generation by generation, things improve.

things like this dont happen overnight by enacting some legislation. it takes TIME.

Re: Study: Wealth gap widened for blacks, Latinos

I dont see the difference in net worth as a "party" problem....we can hang on one or the other. Perhaps its a "people" difference best solved via education and skills improvements. And where does the role of government fit into that equation? Is it governments role that we should all have the same net worth?....I dont think so. Rather, government can be sure "opportunities" are available on an equal basis. Or are we suggesting here that government should force folks back to school so they may be equally equiped to earn a living and accumulate wealth?

Re: Study: Wealth gap widened for blacks, Latinos

Perhaps its a "people" difference best solved via education and skills improvements.

I like that as a answer.

But simply comparing net worth between groups, is deceptively oversimplifying things. So many inner city blacks and latinos live in a macabre world of abject poverty, handguns and drugs that many of us could not even grasp and when we see it, we quickly turn our heads and try to block it out.

What is government's role? I can't be specific but it needs to be an active one because the lives of inner city minorities are beyond hopeless. We can't "rescue" them but if we ignore them, the situation will grow worse and blow up in our faces...a situation that can't be solved by living in "walled" neighborhoods with key card entry.

Re: Study: Wealth gap widened for blacks, Latinos

Originally Posted by Chiles4

I like that as a answer.

But simply comparing net worth between groups, is deceptively oversimplifying things. So many inner city blacks and latinos live in a macabre world of abject poverty, handguns and drugs that many of us could not even grasp and when we see it, we quickly turn our heads and try to block it out.

What is government's role? I can't be specific but it needs to be an active one because the lives of inner city minorities are beyond hopeless. We can't "rescue" them but if we ignore them, the situation will grow worse and blow up in our faces...a situation that can't be solved by living in "walled" neighborhoods with key card entry.

Re: Study: Wealth gap widened for blacks, Latinos

Originally Posted by TacticalNuke

What do you want us to do? Enact socialism whereby everyone is equal?

Perhaps it's just me, but I don't think the only option is one where everyone is equal. What would be nice though is that if everyone had equal opportunity. We don't have that by a longshot in states just yet. Socio-economic rifts between people have kept this problem around for much longer than it should have lasted. Frankly, I'm not sure what a suitable solution is.

Re: Study: Wealth gap widened for blacks, Latinos

Originally Posted by Vihsadas

Perhaps it's just me, but I don't think the only option is one where everyone is equal. What would be nice though is that if everyone had equal opportunity. We don't have that by a longshot in states just yet. Socio-economic rifts between people have kept this problem around for much longer than it should have lasted. Frankly, I'm not sure what a suitable solution is.

Nor am I. However, almost every idea I hear that pretends to be able to solve this involves socialism. Even equal opportunity is impossible. It's a good goal, but impossible. Politicians pretend to be able to help everyone, but the truth is life just isn't fair. I'll never been Bill Gates, the opportunity just isn't there. I accept that and make the best of what I have.

In fact, it's these negative ideas that keep certain people where they are. They feel sorry for themselves and believe there is no way out. There is a way, but it requires them to work. Some people just can't accept that life isn't about getting a good hand but doing the best with the hand you're given. They feel sorry for themselves and just accept that they have a bad life without trying to change it. That's the problem with society. We shouldn't pretend the problem isn't there, but we should realize that the mentality of those in "bad" situations is part of the problem, if not the main part.

Re: Study: Wealth gap widened for blacks, Latinos

Originally Posted by TacticalNuke

Nor am I. However, almost every idea I hear that pretends to be able to solve this involves socialism. Even equal opportunity is impossible. It's a good goal, but impossible. Politicians pretend to be able to help everyone, but the truth is life just isn't fair. I'll never been Bill Gates, the opportunity just isn't there. I accept that and make the best of what I have.

In fact, it's these negative ideas that keep certain people where they are. They feel sorry for themselves and believe there is no way out. There is a way, but it requires them to work. Some people just can't accept that life isn't about getting a good hand but doing the best with the hand you're given. They feel sorry for themselves and just accept that they have a bad life without trying to change it. That's the problem with society. We shouldn't pretend the problem isn't there, but we should realize that the mentality of those in "bad" situations is part of the problem, if not the main part.

No, just because absolute equal opportunity is impossible, is that any reason to just "be happy with what we got". I think not. That's a defeatist attitude. We can certainly do better, and we can certainly get closer to "equal opportunity" than we currently are. Just because the ultimate goal is impossible, it doesn't mean that trying to attain it will be a fruitless venture. I disagree. There is much to be gained in an ongoing process.

The problemis that the current attitude in our societ is "survival of the fittest", while that may be a good rule for evolving animals, I'm confident that there is better way for humans. A survival of the fittest attitude leads to jeaousy, war, and contempt. Afterall, we are more than instinctual animals are we not? We can choose our path to a degree that is greater than any living organism on the planet. Why can we not simply choose to help enlighten our more unforutnate comrades?

Re: Study: Wealth gap widened for blacks, Latinos

Originally Posted by Vihsadas

Yes, just because absolute equal opportunity is impossible, is that any reason to just "be happy with what we got". I think not. That's a defeatist attitude. We can certainly do better, and we can certainly get closer to "equal opportunity" than we currently are. Just because the ultimate goal is impossible, it doesn't mean that trying to attain it will be a fruitless venture. I disagree. There is much to be gained in an ongoing process.

But the process begins in the hearts and minds of those with less. It begins at the bottom and works its way up, not the other way around. When people from the slums work to change their life, people will take notice. They'll think, hmm, maybe we should start such and such a program. But it's a mental issue.

I was dealt a certain hand. I'm going to make the most of it. Sure, it'd be nice to be Bill Gates, but I probably won't be him. I'm studying to be an Electrical Engineer with the plans of going pre-med and becoming an orthopedic surgeon. I could've worked in a cubicle all day, but I set lofty goals. I want to make the most of what I was given. That's what I feel everyone should do, and I believe some people aren't

Re: Study: Wealth gap widened for blacks, Latinos

Perhaps that's true. But does that mean that we should just "leave them to their devices". No. Instead I feel a reponsibility to hellp my fellow man realize that he can become more, and to help him improve himself. I would rather be the person that gives confidence to someone who needs it rather than simply say, "Well, it's got start with his doing". Why can't it begin with my doing, and then be continued by his doing?

Re: Study: Wealth gap widened for blacks, Latinos

Originally Posted by Vihsadas

Perhaps that's true. But does that mean that we should just "leave them to their devices". No. Instead I feel a reponsibility to hellp my fellow man realize that he can become more, and to help him improve himself. I would rather be the person that gives confidence to someone who needs it rather than simply say, "Well, it's got start with his doing". Why can't it begin with my doing, and then be continued by his doing?

It can start with your doing if you wish. I personally do not give my time to inner-city kids. Do you?

Here's what I think. Society has made it seem like certain people can't get anywhere. They just accept that their life sucks and follow in the footsteps of those before them. If you want to help, do so by making sure they understand they can be more, but that it is going to take some effort on their part.

Re: Study: Wealth gap widened for blacks, Latinos

My take on this is simple... its all about home ownership.

I guess you could write books on why certain parts of a society persue ownership of their homes while others do not, but that can be left for authors with the interest. If anyone is interested in building wealth of their own in the United States, I'm pretty sure any financial advisor worth their salt would recommend to that person that they start with real estate.

Go to your class reunions and ask your wealthiest classmates when they bought their first homes. I'll wager that the answer is someone around 21 years old. Its a simple matter of priorities...

The down payment for my first house required selling my most prized possesion, a '72 Chevy pick-up truck that won first place in the Oakland Roadster Show's "Best Post-War Pick-up Class"... probably the best "financial sacrifice" I ever made.

So my advice to anyone interested in generating assets... buy a house (not a mobile or modular).

Re: Study: Wealth gap widened for blacks, Latinos

Vihs,

Show me a plan to moves people from poverty to self-sustenance and you can have my money. People talk of equal opportunity. I prefer to focus on equal effort. Education is a big part of this. We spend more per pupil than most other nations, yet we have loads of drop-outs and underachievers. Why is this? School quality is a prime issue, but school quality involves far more than money spent and personnel hired.

I like what Cosby has said on this topic this year. People need to quite pointing the finger of blame at everyone else and start looking in the mirror.

I don't mind tax money to provide free education, but I'd appreciate people taking advantage of the opportunity presented rather than pissing away the gift.

Yeah, it's an oversimplification on my part, but seems far too many people "value" all the wrong things. School is un-cool. Being smart is less attractive than being a playa.

Even with education, wealth is not guaranteed. Some folks have really good paying jobs, yet never save a dime. At least three of my sisters could be poster-children for the "too foolish to save, gonna have to live on SSI" campaign. Building wealth means saving a portion of what you earn, no matter your income. Very, very few people truly must spend every dime on necessities of life in this country. IMO, the ranks of the poor outnumber the ranks of the low paid.

I grow weary of social programs that do nothing beyond maintaining the status quo. I grow weary of people who do not seize the opportunities afforded them to get a leg up in life.

However politically incorrect, it is largely a cultural issue. Until education and hard work gain higher priority entire cultures will tend to suffer. Show me a program that successfully changes that before asking for more programs.